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Government Affairs Albany Update

March 2, 2001

Minimum Wage Bill Introduced

Following last March's state minimum wage increase to $5.15/hr., matching the feds and locking New York to any future federal minimum wage increase, and a subsequent failed attempt in June to further boost the minimum wage to $6.75/hr., it's back!

A.5132 (Nolan) would raise the minimum wage to $6.75/hr.effective 1/1/02 and provide for automatic annual increases tied to the federal consumer price index in the New York-New Jersey area. It was reported from the Assembly Labor Committee on February 27th. S.2420 (Schneiderman) has been introduced in the Senate. While it is not a companion bill, it calls for the same increase over a two year period.

Senator Bruno Unveils Empire Zone Proposal

Senator Bruno unveiled the Senate's "Empire Zone" proposal this week. The Senate is proposing to:

According to Bruno, under the Senate proposal, every locality that has asked for a zone, and meets eligiblity requirements, will receive one under the Senate proposal.Our press statement supported the proposal, saying, "Empire Zones have proved their worth as an effective tool of economic development and job creation. Today's proposal will make New York State an even more attractive site for new jobs and plants."

Business Council Comments on Great Lakes Proposal

The Business Council has urged Governor Pataki and the Council of Great Lakes Governors to reject a proposal to impose significant new requirements on facilities that withdraw water from the Great Lakes.

This proposal, put forth by the CGLG would:

The Business Council said that its members were "alarmed" by the proposal, and that, although we support the goal of regulating large scale diversions out of the basin, we question whether any of the new 'approval criteria' were necessary to achieve that goal.The formal public comment period ended February 28, although the CGLGs will be accepting additional comments for the next several weeks.

Deputy Majority Leader Skelos Expands Single-Sales Factor; Eleven New Sponsors Join S.2064-A

Senate Deputy Majority Leader Dean Skelos (R-Nassau) has expanded his introduction of The Business Council's #1 tax priority for 2001 -- Single-Sales Factor Apportionment (SSFA) for Article 9-A taxpayers -- to apply SSFA also to the 12-county Metropolitan Commuter Transportation District surcharge (Tax Law, Section 209-B). This extension of S.2064-A is consistent with both the concepts behooving any state to select SSFA as its formula and with S.1149/A.2001 and A.5317 [two other SSFA bills concentrated on manufacturing only introduced by Governor Pataki's Executive Budget and Assembly Subcommittee on Manufacturing Chair Joseph Morelle, respectively].

Eleven Senators have joined Senator Dean Skelos in sponsoring The Business Council's bill to adopt the "single-sales factor" to calculate state corporate income taxes. New bill sponsors are: Sen. James Alesi (R-Monroe); Sen. John DeFrancisco (R-Onondaga); Sen. Hugh Farley (R-Schenectady); Sen. Kemp Hannon (R-Nassau); Sen. Nancy Lorraine-Hoffmann (R-Onondaga); Sen. Owen Johnson (R-Suffolk); Sen. Michael Nozzolio (R-Seneca); Sen. Frank Padavan (R-Queens); Sen. Nancy Rath (R-Erie); Sen. James Seward (R-Otsego); and Sen. Caesar Trunzo (R-Suffolk).The single-sales factor would base corporate income taxes solely on a taxpayer's sales to in-state destinations. Adopting the single-sales factor for all corporations is The Business Council's top tax priority for 2001. State corporate income taxes are now based on in-state sales, property, and payroll. This effectively encourages employers to site jobs and plants out of state by cutting their New York tax as a reward for reducing their percentage location of jobs and investments in New York.

Eleven states have already amended their apportionment formula laws giving greater weight to the sales factor than New York's 50% weight for the sales factor. In addition, legislation adopting SSFA is progressing in Arizona and Maryland, where it has been introduced by Republican Governor Jane Hull and Democratic Speaker Casper Taylor.